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tv   On the Move With Rishaad Salamat  Bloomberg  March 2, 2014 8:00pm-10:01pm EST

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>> a good morning to you. we are on the move in asia. the crisis deepens in ukraine. asia stocks have opened with the kleins. investors seeking safety are driving up gold and they end. breaking news out of china right now.
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55 is a fairly encouraging number for stocks. the service number does help sentiment. we are seeing a day of risk aversion to kick off this trading week. we had manufacturing gauge, for example on the weekend, 50 points. so it's barely an expansion. you are looking in little bit of a shift from manufacturing to what is already a bigger portion of the economy. i just wanted to mention a few other macro themes today. we are also watching the geopolitical concerns on the weekend. that is driving up the value of the yen. on the yenyou more in just a moment. you are also looking at jgb yields. 10-year, 57 basis points. you are watching money flow into safe haven at this point.
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i also want to mention we are waiting for inflation data that comes out of indonesia and thailand. morning, another key thing to watch out, speaking of meetings inthe npc beijing. that is when the government comes out with growth targets and their plan on how to achieve their targets. will it reach the 7.5%? yen, just about at a one-month high. >> one of the concerns has been about which parties to go look at. now a look at the npc. clearly, a lot reforms are being talked about. yuan's recent weakness is a
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concern. what can we expect? >> it is pretty interesting. absolutely. it is a pretty interesting opportunity for the npc to really take home broader importance than it would normally be perceived from the outside world. it starts back with the third plenum in november. with that event, there were 60 specific policy areas that were discussed. we are seeing a flow of several that gives since then action to those broad plans. the npc could take that a step further. and it affects a host of industries, really all industries. >> of course, the shanghai free-trade zone is evolving. over the weekend, comments on what we're going to do about trade form investment. how does that fall into the story? the shanghai free-trade zone is one of the several initiatives that are coming through.
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this is a test bed certainly for policy reforms, most notably in the financial area where you have liberalization of the yuan and interest rates and other aspects of the banking business. theinteresting part over last six weeks or so is the further discussion. you can see another dozen free-trade zones popping up around the country that are in the midst of an approval process. all it is there is that shanghai is about finance and maybe aspects of technology and health care services and maybe other areas would take on the importance of other industries. whether shipping, manufacturing, technology, what have you. this is a place where reform can be a test bed for further expansion. >> market reaction so far, again, it is priced in, but the 81 are you believe is state enterprises. >> it is intriguing looking at
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the market reaction over the course of last year. the msci chinese one benchmark. basically flat. down 4% or so this year. you say who cares, but it was a little bit of a spurt around the november plan him. if you look at various sectors, much more notable reactions, health care, utilities, specifically in wind and solar being prime and if consumer also taking off in certain ways. if you think about soe's as a group, there are several that are they-share listed in shanghai. again, down about 4% this year. but look at what happened with sinopec in the last couple of weeks. they announced the potential sale of 30% of their retail units to private investors. that is exactly spot on the type of policy that the reform opening up from the plenum could eventually bring to bear.
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and that is up about 20%. >> a lot of reforms again to be announced. >> indeed. >> the latest news from the ukraine, kiev has the military on full alert and is calling for international help. that is as russia has tightened its hold on crimea. has anntified government area,ase in crime effectively imprisoning the soldiers in the area. happened isalready that a brazen act of aggression in violation of international law, in violation of the yuan charter, in violation of the helsinki final act, in violation of the 1997 ukraine-russia basing agreement, russia has engaged in military active -- in
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a military act of aggression. >> we are on the brink of disaster. there was no any reason for the russian federation to invade ukraine. >> one of the biggest impact is gold and commodities. what's we are seeing commodity prices up, john. on theensions geopolitical front, as you just mentioned, did take a turn for the worst on the weekend. whatlso have to factor in happened this morning. south korea confirming that the north did fire two short range missiles. those are the only details we have at the moment. we see an energy prices up. so we see an uptick for brent. point when these oil prices continue to uptick.
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it will get to a point where people will start thinking about inflation. perhaps what it could mean for growth ahead. for gold, one point three percent, we are now at $1343. a $150 gain so far. north korea, when that happens, we usually get an uptick along the south korean defense plays. naver corp, two percent down after gains last week. i will be back later on. john, back to you. j.crewican fashion has -- has friends in very hype very high places. and may have a new owner. >> that is the country trading in the japanese trading session. they may acquire j.crew for a
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deal valued at the $5 billion. really looking to make inroads in the u.s. unwilling to grow and expand overseas. they want to be the world's largest clothing retailer. so they are betting on scoop-neck tees and cardigans. the bigs fan is michelle obama the united states. she loves them. i love -- i wear some j.crew j.crew -- i wear some clothing. it is hard to buy it here. leonard green has been the guy behind gap and trying to promote j.crew's band overseas. similar goals. j.crew is a privately held company. according to people familiar with the matter, they have explored the idea of going the ipo route. but that his not -- that has not
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this is armed during company that finds itself in a mid-tier. they have about 17 stores in the united states. stores allbout 500 around the world. they will be opening in australia and in germany later on this year. again, other companies that have expressed interest to buy j.crew is south korea's ilan. no one is commenting on this proposed deal. inuvo they sponsor in sports? -- you know who they sponsor in sports? novak djokovic. >> they are looking to list on wednesday. raisere not looking to
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new funds. that is fast retailing. the goal is to expand in hong kong. by having a base here in that will help them in their efforts to expand their global presence. i want to show you the stock price. beenthe last year, it has impressive. fast retailing stock almost doubling if you take away the last couple of months of late last year. but you can see the white line is now up to 38%. the orange line is up to 20%. you can see it outpacing the topix in that regard. >> listing in hong kong this week. they buy a j. crew, that could also be a listing as well. we will see. >> lots of moving pieces. >> thank you. we can see the markets with a
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slight decline against the singapore futures. the market itself finished .5% on friday. still to come, a closer look at the asian markets. japan is a big issue. concerned for australia.
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>> welcome back. it is monday march third. if an agreement can be reached, it will crate one of the world's
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biggest free-trade blocs. the annual meeting of parliament turns for two weeks. wednesday, qantas's alan joyce to discuss the future. this comes after a half yearly loss of almost a quarter of a billion dollars. lands to cut 5000 jobs. one of china's biggest developers have fourth-quarter earnings on thursday. that is as the government continues to try to cool the property markets. american realh an estate investor for the first project in new york. reactions, my next guest now joining me from melbourne. not exactly born today, our
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we? the ukraine, china, all these concerns about the markets themselves, commodity prices. what do you say to your clients this morning? clarityait for some around the situation. let's not be a hero and try to buy the pullback we have seen in things like the s&p futures. let's wait to find out exactly what happens. i like to wait for the bit more certainty. if we do see this ending and an escalation, sanctions will be placed on russia from the west. -- noting this victim buying this bit right now. we have something for stock pickers and something for top-down macros.
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things are huge this week to focus on. just saying stay clear until clarity prevails at the moment. >> on friday, the u.s. jobs ticker is at 155 forecast. japan is an issue. australiaf is an even bigger issue. why is that? >> if you look at some of the addictions in terms of trade coming forward, that is something that is not factored into forecast. if you look at the numbers last week, that was a big drop-off. it is clear that, even though the radical loosening of monetary policy over the last year or so in australia, and has not benefited to the tune that the rba would like to see. .hina is very much a watch i am sort of neutral on china. i still think we will see 7.5%. some data coming from the operating profits. that was slightly below expectations.
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infantry numbers below expectations. so that puts a downside risk on the gdp number. then we have inflation which i think will peak in the second quarter and then slowly dissipate into the year-end with a lot of the tradables coming back under. a monetary policy perspective and the impact on the aussie dollar, i think it is the central bank that we need to watch is the one who will potentially but the buys back on. that will bring the green light to trade again. >> so a rate cut was not it. >> as it stands at the moment, i think the market has a very flat buy. if we do see some of this data in rate, we will see cut camp -- we will be sitting in rate cut camp. >> the margin debt is at a
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record in january. how concerning or how alarming is that if at all? it is quite alarming, i suppose. but we need something pretty sizable to create a big capitulation down. that would then exasperate the fact that we will see a lot of margin calls being placed. let's not forget we have seen record levels of margin debt for many months. we have had everything thrown at the s&p and the kitchen sink, tightening and geopolitical issues. so news flow, current news flow, i don't expect it to be a major concern. but if we do see something more radical, which is a much bigger macro, then that would be an issue that would certainly exasperate the selling and cause a bigger reaction. us,hris weston joining global markets strategist from melbourne. next, from china to india. citiesat how asia's big
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are grinding to a halt. that is after the break.
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>> welcome back. asia has some of the most gridlocked cities in the world. almost 20 million cars were sold in china last year, leading to clogged roads and increased pollution. stephen engle looks at what the
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government is doing to smooth the way forward. >> wouldn't you know it, on a day that i would do a story about traffic, traffic today is not too bad in beijing. perhaps it is because the pollution levels are upwards of 400 and people are perhaps staying indoors. nonetheless, the beijing government and also the governments of other big cities who have big traffic problems, they have been are stricken the number of cars on the streets every workday and for example, i cannot drive on one day of the week. there are a lot of rumors that perhaps i will be spread to two days a week to get the number of cars off the street. authorities are also tightening up the license plate lottery where they restrict the number of license plates that are actually issued every month. that was introduced in 2011. i got mine before the restrictions came into being. guy i just about
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hit him. that is another hazard about driving in china. so back to the lottery, the joke that it is more likely to win the actual lottery then winning a license plate lottery. last year, 22 million vehicles were sold in the chinese market. for the fifth straight year, that surpassed the united states, making china the world's largest automobile market. look, traffic again. you cannot go a mile without hitting bad traffic in china. by 2020, this market will sell 30 million vehicles. and with a big push for urbanization making big cities like beijing even bigger, oh, they gridlock is just going to get worse. driving through the pretty intense beijing traffic problem. various measures have been introduced to try to curb this.
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that is the plan at least. they have not taken effect. >> the problem is that they are temporary. they will ease the problem but will not solve the problem of the number of cars on the road. last year, 22 million sold gold literally can carmakers -- sold globally. carmakers are planning to put out 120 million vehicles out in 2016. that is a big jump. toto sell them as opposed take them off the rose. >> yes. is also predict in that there will be something called peak car. the number of cars will topple at 100 million per year because of the gridlock on the roads. so it is quickly becoming chicken-and-eight. people cannot get around. people will find alternatives to travel around. the yuan is predicting that there will be 22 megacities next is predictingn.
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that there will be 22 megacities next year. that will be people in close park city wanting to buy cars on the road to nowhere. >> thank you for that. some call it a violation of ukraine's sovereignty. russia takes control of the southern region of the country. we will have an expert way in. and for markets in hong kong and shanghai, as they get underway this morning, we will have the opening numbers just after this break, including reaction to the pmi weekend this morning as well.
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collects the ukraine crisis deepens as russia moves in. asian stocks open with the kleins. a summit innding russia in june. chinese factories lose momentum ahead of this week's party meeting in beijing. a look at the markets -- a lot of news. stabilityand and rocking the markets. >> we are bleeding red am a bleeding love, whichever way you want to put it. look at japan. we are down 2.5%.
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the strong yen has to do with most of the damage. the risk aversion, we are just getting the opening numbers so far. or the shanghai composite and the hang seng index, just about in line with what the futures were premarket -- what the premarket option were indicating in the philippines. let's just wait for that to get underway. out -- ant to point lot of people have been watching the chinese currency because -- year ago for 30 days. it has weakened. if you look over the course of two years or even longer, if we can get that up for you, come on. relax. 1.5% over the course of two years. with the rupiah, for example.
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opening levels for these indices, the shanghai composite building on those losses. is the dollar-you on -- dollar-yuan. watching.ks we are one of the bigger industrials and china. it did report a profit in 2012. you have a shares in shanghai. kai, a big property developer in hong kong, earnings down eight percent, which is why you see the stop being bid down at this point, just above 96
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hong kong dollars a share. most --is one of the party leaders meeting in beijing for their annual session of parliament. this year, talks were dominated by a cooling economy and rising concerns about the environment. tom, manufacturing pmi over the weekend fell slightly. is that a sign of the reaction of weakening growth? is a bit of both. at pmi trajectory came in 50.2, down from 50.5 in january. so it is still slightly above the 50 mark, which is improving from deteriorating conditions. deceleration in the manufacturing sector. the big question is is this to do with february, which this year had the chinese new year holiday, or is it a reflection
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-- a reflection of genuine problems in the manufacturing sector? pmi?at is the reaction to has rebranded to past 55 from the record low of 53 in january. theome evidence that in domestic economy, and the services sector, it is actually doing slightly better. yuan hasrse, the weakened significantly over concerns. have the npc kicking off this week. what does this mean for the government's broader growth strategy? >> one of the concerns is that a weakening yuan is a reflection of lower investor confidence in china.
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be deliberate strategy by the people's bank of china. they are tried to push it lower to punish speculators for taking one-way bets on yuan appreciation. on the national people's congress, which is kicking off on wednesday, i think that the main focus of attention will be on the politics, the central aspect ration being that the first work report of the npc will set a target of 7.5% growth , unchanged from last year. but there are some economist who are talking about perhaps a 7.5% target to give the government a little bit more flexibility to push through painful reforms without having to worry too much about pumping up growth. >> tom, you live in beijing.
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what is painful is the atmosphere. how big a deal -- how important is it that the pollution issues at the top of the agenda at the pnc? >> in terms of public satisfaction with the government, pollution is coming right to the top of the agenda. it is very visible. the air in beijing is grainy. the visibility is low. the air. of: that is the base problem. the issue for the government is that china's economy is a coal-based economy. the vast majority of energy is coming from coal. it is an economy where more and more people are driving cars. so dealing with this problem is extremely intractable for the government. >> thank you for your time this morning.
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other stories making headlines, soul says north korea has fired more missiles. but the defense ministry says two short-range weapons were lost at about 5:00 a.m. this morning hong kong time. their reported to have a range of 500 kilometers and followed four launches last week. those were about 200 kilometers and were fired into the sea of the east coast. chinese police show guns and knives that were used in saturday's deadly attacks. people were killed at a railway station. more than 140 were wounded. four of the attackers were shot by police. the search continues for the other five. state media says two of the attackers were in fact women. security following these attacks, the most violent incidents blamed on uighur separatists, happened more than a dozen kilometers away.
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a suicide car attack that killed ianeman datein t last year were also blamed on the uighurs. says that they will [indiscernible] and continued their campaign. 22 people have died and hundreds more have been injured since the protests began at the end of october. billionaire li cautioning may be getting wealthier this year. watson will be valued at more than $20 billion in an ipo. warren buffett missed his target for the first time while berkshire underperformed in the snp over the last five year.
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he does not expect that to happen again during what he calls full market cycles. was visitedeeting by thousands. top corporate headlines this morning, up next, we have the reform debate. why china might downplay the projections on the economy. you're watching "on the move.
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>> let's get back to what is happening in the ukraine. ev have put its troops on full alert after russia took over crimea. many thanks, professor, for joining us. does this equate to actual invasion or not? >> it is a partial invasion. it is particularly in crimea.
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the russians would say that what they are doing is looking after their interests, their legitimate interests, the neighboring crimea, which, according to the agreement they signed recently last year, they have the rights to protect until 2042. so in that sense, there is a certain amount of justification. but having said that, the reasons for threatening ukraine the way they are insane saying that they are protecting russians in ukraine come i think most people outside russia would find that completely unconvincing. >> president putin called or referred to them as fascists. there is a lot of nationalism building up. >> there is. there is a lot of nationalism, including in russia. aspectsthat one of the of this invasion, if we want to call it that, certainly an incursion, is the kind of land
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which that putin is using is not dissimilar from the kind of language that stalin used in 1941. fascistsof threat of to russians. and hoping that people will see the relevance. that is a very stark comparison to stalin. so far, international reaction, john kerry called it an incredible actor rick -- backed of aggression. act of aggression. >> in my opinion, the way europe has reacted is exactly the way they should react, showing that this is totally unacceptable. but at the moment, talking mostly about economic and npr sanctions, throwing rush out of
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sochi, noot attending mention of military integration at this stage. i think that is the correct approach. it gives the russians, gives putin an opportunity to come to the party and let the whole situation calmed down. at history, you mentioned the stalin comparison. have you think is will play out? will it lead to the next batch where will it lead in the next one month to two months? what putining that will demand and should be given is formalization of the agreements that again a covert yanakovic gavet him.
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if they get that confirmation, for theer reasons russian incursion in crimea seem to disappear. then putin needs to come to the table. at the moment, the west is reacting as if russia is strong. russia has a, number of problems. the economy slowed down last year. brics,een as one of the one of the developing economies in the world. 1.5%ompared russia's growth last year and it has serious problems. comparisons.esting thank you for your time. it is now march, which means we are just about one month away before the much-talk-about and some contact --
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much-talked-about consumption tax in china. --yes, we are just barely over a month away, really, before everything in japan gets a little bit more expensive. think that the central bank of japan is to do more increased stimulus to increase the stimulus. one reason behind their thinking has been with what they like to call the sticky japanese yen. recently, it has actually strengthened. to break out of this trend, goldman says that the bmg will have to do more. what this shows use the -- that the boj will have to do more. what this shows you is, at the same time that the boj decreased
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its bond buying program, now we are south at about 6 trillion since the start of january. so what is the thinking here? much thea limit to how central bank can influence the bond markets given the current policies. in other words, they need to do more. how do you make money? or how do you avoid losing too much money? craig when coupled and investments has this note last week. they say by the south korean won . yen, ae the japanese further slide in the japanese yen. let me leave you with this. there we go. that is what you have for the japanese yen and the malaysian currency.
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aberration,of an obviously. then again, something to look out for definitely. that was her global outlook for today. pmi foracturing february with estimates of 40.5, a slight -- 48.5, a slight contraction. above 50 is clearly expanding. thank you for joining us this morning. 48.5, 50.2 of the weekend, the chinese economy is sputtering, as it were. not convincing, but certainly with a bit of strength. >> yes, the first couple of months, from all of the data shows that the economic data has
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been a little weak. but with limits. overe are perhaps concerned that the economy is weakening a lot. but let -- but the data are patchy during this time and heavy distorted by the chinese new year in fact. so we shouldn't read too much. don't worry about aggressive credits happening. ,he recent weakness in the yuan you say a change in exchange rate policy could unwind hot money flows. the risks could be quite intense. are you surprised by the reaction? again, the biggest drop in quite some years. >> it is the biggest drop in the history of the yuan in the last few months. othermpared to currencies, and the emerging markets, people hardly notice it in that kind of volatility. in our view, the government is try to probably guide or engineer some volatility, some
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uncertainty in the exchange rate to discourage foreign exchange inflows, which have been massive in the last few months. so that is the risk -- of course, money unwinds. somecould lead to liquidity tightness. at the moment, we have not seen that. if we do experience a lot of outflow, the central banks can actually inject liquidity to offset that. .> many talk about reforms clearly, pollution must be tackled. how groundbreaking will this be, do you think? >> this is the first year of reforms after the third sign him. and this is the parliament meeting. so a lot of the reform measures will be approved legislatively. so it will not be in the interest -- initiatives groundbreaking, but there will be a lot of inaction and implementation. i think reforms related to environmental issues and
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pollution will be very high on the agenda because the government wants to tackle issues that affect the people the most. what people aren't the most unhappy -- what people are the most unhappy about. >> thank you. a lot of theses here. i'm sorry that time was against us. the oscars are under way. celebrating those famous golden statues. "on the move" is back after this short break.
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>> you are watching "on the move." oscars sir moneys are on way -- are under way -- this year's oscar ceremonies are under way right now.
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head-to-head in the coveted best film category. the canon has already handed out a few awards. movie special effects, this year, a lifetime achievement award. jon erlichman went to see how it works. transformers: " dark of the men," he may have recalled a sea of exponent cars. in these behind the scenes footage, you can see this is not cgi. you have green cars flipping. red card slipping. even school buses. the device that makes it happen is the pneumatic car flipper. john grazer help to dream it up for director michael bay when he was shooting "armageddon." this is michael bay's favorite toy. >> here's how it works. a car is placed on top of the car flipper. it looks like a floor jack.
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it is loaded with high pressure nitrogen. that pushes into a piston that then throws a car as far as 25 feet. >> you want to get that air in that cylinder as fast as you can and as much as you can and that is what makes it work. 3, 2, 1 -- that is how you flip a car. -- theindustries industry pause flipping tools of choice had been a couple of cans. >> this is the most economical way to flip a static car. $500is going to cost you and you multiply that by 30 cars, it gets expensive. you can take a cable and wrap it around the car. maybe we will get back 200 feet. then you pull on a high-speed accelerator along with the car flipper and it will pull the car. >> so once you flip of the car
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and it is in rough shape, what do you do with the car? >> they will go back to or go to a wrecker. boolean four more years, it may be a bobsled in the next olympics or something. [laughter] >> a quick check. the besto has won supporting actor award for "dallas buyers club." . drag queen he has received the best supporting actor, the first award. more today's top stories and market news and oscar news, 24/7, check it out. on the move is back
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after this short break.
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>> a very good morning to you. we are "on the move in asia." memories of the cold war, russia and the west at odds over the ukraine. stocks are falling on the crisis with investors seeking safety in gold. australia's rise [indiscernible] for chinese investors. kia has put its military on full alert and has appealed to international help. the u.s. is considering sanctions against moscow and the
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g8 has ended preparations for the meeting in june. hasident barack obama pledged to president clinton and has sent secretary of state john today.o kiev >> a brazen act of aggression in violation of international law, in violation of the yuan charter, in violation of the helsinki final act, in violation of the 1997 ukraine-russia basing agreement, russia has engaged in military -- in a military act of aggression against another country. >> we are on the brink of a disaster. there was no any reason for the russian federation to invade ukraine. get reaction to all of this again.
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the commodity space is the most sensitive to all of this. obviously, the price of oil taking a hit. just put this into context, first and foremost. you don't see the currency being affected. the dollar is actually a little bit stronger. ofides that, we see a lot the contracts continuing to trade higher. us look at nymex, brent. at nymex, brent. that $1340 an ounce. that is what you have for nymex, 10 3.80. this is what you have for brand. dust about at the highest level so far. and let's look at gold. it has been a very good year. 11.5% from the start of this year. i also want to show you what is
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happening in these currency space. you are seeing very sharp moves across a lot of these natures cities here in asia. of course, that is what you have for the chinese are nimby. rinimbe.inese are >> have a pollution in beijing, we are joined now by tom erlich. pmi falling slightly. do you think that is weakening growth or more to do with the new year's break? >> i think that's right, john. a bit of those. the signs from china's economy from the mentoring -- from the manufacturing sector from the beginning of the year have been pretty weak. purchasing manufacturers index they came in at 50.2, down from 50.5 in
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january. that points to a slowing growth in the manufacturing sector. this morning, we had the hbc market number which wants to pretty tough conditions for china's smaller factories. the question for chinese leaders data pointingest to weakness in the manufacturing sector or is this more of a seasonal effect? we saw the chinese new year in february. is that distorting the data? a lot has been talked about him a reforms, what they will put into action. what does it mean for the government with a broader strategy? >> the big question coming into the national people's congress on wednesday is what the premiere will set as the gross target for the year.
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last year, it was 7.5%. most economists think that it will be 7.5% again this year. that there are some who say that it would be wiser for the premiere to set a seven percent target or go for a range of expectations between 7% and 8%. that means less pressure on china's local governments to pursue a growth-at-all-costs strategy. >> video of the pollution in beijing, of course. without a doubt, the most talked -- talked about topic on the agenda. could be the reforms to do with that? if anything. >> i think that is right, john. it is clear that there is a very serious problem with pollution. the air is grainy.
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visibility is extremely low. coalmell of: the air -- of in the air. poor people on the chinese streets, that is a big issue they want to see the government dealing with. the issue for the government is china's economy continues to be a coal-driven economy. the majority of energy is coming from coal, which is very dirty. at the same time, the aspirations of chinese people for a higher quality of life in a for a lighter -- a life in the city as opposed to the countryside, for a life where they have one car, maybe two cars, all of these things are contributing to a deteriorating air quality. so just a very difficult balancing act for the government. >> tom, thank you for your time. current fxnce at the reaction to all of this, david is here with more. it is really a lot -- there has been a lot of talk obviously that the pboc wants to send a
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signal to the markets that perhaps it is not a one-way street. people put their money, for example into the chinese currency. the assumption is that it will continue to strengthen. what you have seen over the past 10 or so sessions is that it has actually weakened. we are just about at the longest streak of losses for the chinese currency at about 19 years. two years after i was born. i'm just getting. the aussie dollar reactor thing -- the aussie dollar reacting as well. if you dig deeper, you look at new exportmponent of orders, that has been a contraction for three straight months. australia is a big trading partner. well, china is the biggest trading partner for strozier. the dollar-yen, of course, if you see green on the screen, that means that currency is
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strengthening. so you see a third day of strength for the jets ain't -- the japanese currency. haven more of a safe trade. a quick look at other stories making headlines this hour around the world. and -- hong kong's largest property developer will spend $3 billion to buy a property in the city. hong kong is selling more land as it seeks to bring down prices. japan, talks about j.crew. negotiations are at a early stage. fast retailing may face competition from other bidders. it will help the owner expand its business. promised her tony
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abbott says he does intend to change the ownership rules for qantas. the carrier has complained that its rival or -- its rival, faced australia, has competition overseas. it has lost a court of a billion dollars and has plans to cut 5000 jobs. nuclear with a uranium producer that recently [indiscernible] .iving us his take uranium is the deal itself. that is next.
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let's turn our attention to mining. set tolar uranium is merge with azhar georesources. zarga resources. believe, means stallion in the year of the horse. >> that is right. >> first off, ukraine and the impact on uranium, of course, russia is heavily dependent on uranium. how do you play this one? big nuclearas a power industry and it is also a minor of uranium itself. but the impact on the industry would be, let's say if there is some issues between russia and west not then the
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wanting to buy russian uranium exports are -- uranium exports russia'sum exports is primary mining industry, it could pose problems. japan has announced its dropped energy policy. they are saying that nuclear will be part of the baseload supply generation. it makes sense for them because it is half the cost of using lng and coal. japan has no natural resources. so most analysts believe the japanese to restart tended to it -- 10 to 15 plants this year and continue restarting next year and the year after. >> azaga uranium, why should investors care? is aanium as a commodity
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generational theme right now in our sector. uranium prices are at a 10-year low. fromok a total bead down fukushima and from the lehman crisis before. yet the demand is still intact. this industry will have record thand in 2016, more so 2010 the year before fukushima knocked out the japanese reactors. yet money supply is falling and the price is so low that new mines cannot come on. existing -- 50% of existing capacity is not a fumble. so you have a sector -- not profitable. sector in the mining industry that is in crisis. yet the world needs 50% more this material by 2018-2020. so we need the price to go up and it will here in -- it will. >> by how much?
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>> the incentive prize for new capacity, if you analyze the sector, the amount of capacity that needs to come on is about 8 -- about $80 per pound. it is more than twice the current price of uranium. commodity, when the mineral commodity doubles, the equities go up five times, 10 times. this is what gold was in 2002. this is a unique opportunity within the minerals space. >> this is every verse, isn't it? >> yes. states,assets in united and turkey. we were the biggest shareholder of this company. we had 45% of that. we are putting all of our private assets into power tech and then power tech is giving azaga shareholders shares and
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renaming itself azaga uranium corp. and it will have 77% of azaga uranium corp. and we will have the management of this company. >> and the mind you have to develop, again, how potentially huge are they in resources? >> we have a number of different thes literally across world. we are in three different continents. somewhere around 5 million pounds a year of uranium, which would literally put us into the top 10 of the industry. we will be one of the biggest producers of uranium in the united stateshe sector, which is the biggest consumer. we will be ready for construction quite soon. it is a diversified play on
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uranium. it is. uranium, but it is ever so fight across assets. so it should be a make cap way to play the uranium upside. >> [indiscernible] a 90dson taylor ranch is million pound deposit in colorado. it is one of the largest, the second largest urine and deposit in the united states. largest uranium deposit in the united states. asia, kaz extent is the biggest producer of uranium -- kazakhstan is the biggest producer of uranium. we have a good intention to develop that in the future. >> thank you for coming in. newsck check at some other
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this week, officials from south korea, china and japan meet in seoul on tuesday for a fourth round of trade talks. if an agreement can be reached, it will create one of the world's largest free trade blocks. the people's congress begins on wednesday. also wednesday, qantas boss alan george is set to discuss a half yearly loss. a billionquarter of dollars and will cut 5000 jobs. , the -- china va on results will be announced thursday. up next, find out why chinese
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investors are buying big down under. live from sydney after this break.
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>> australia's real estate market has experienced a fundamental shift with chinese investors the biggest foreign buyers. last year they splashed out almost $6 billion on commercial and residential property.
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why the growing chinese interest in australia? all you really need to do is check out the view behind me and compare that with what we have been seeing at a beijing over the past few weeks. the environment here is clearly much better. but there is a combination of push and pull factors. as you mentioned, the chinese government is taking pretty active steps to cool down the property market their. -- market there. the capital gains tax, you need 70%,ve a down payment of which is quite significant. so that money is looking for somewhere us to go. australia has some obvious appeal. not only is the environment much are specialthere visa categories for wealthy chinese coming to urging them to invest here. a lot of chinese are sending their children to schools and universities here. they look to buy homes for them. many weaker australian dollar has made property here relatively cheaper.
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i say relatively because the quality of the housing hearing is not that fantastic -- the housing here is not that fantastic. but that has not told the chinese interest. innese investments commercial and residential real estate property here in australia is up 42%. 5.90 $5 billion. that has taken over the number one spot over the united states. and that includes a plunging u.s. investment in australia. seems that chinese investors are more than happy to fill the void. >> thank you. a quick check on the winners of this year's academy awards. disney just won the academy award for "frozen," animated feature. jerod leto who won
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the best supporting actor. next, the supporting actress, jennifer lawrence. that is for "american hustle." they could be either one of those two for the supporting actors coming up quite soon. the academy awards are being hosted by ellen degeneres. three films go head-to-head in the coveted best film category. we will be watching the asian hopefuls this year, including cambodia. the missing picture is up for best form in which film. it is about the khmer rouge rule back in the 1970's and japan's "the wind rises." the academy has already announced some awards this year.
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but the best site tech awards, this year, the man who treated the pneumatic car flipper was given the lifetime achievement award. saw paramount's "transformers: dark of the moon," you might recall a sea of exponent cars. you can see this is not cgi. you have green cars flipping. red cars flipping. even school buses. the device that makes it happen is the pneumatic car flipper. upn fraser health dream it for director michael bay when he was shooting "armageddon." >> this is michael bay's favorite toy. >> here's how it works. a car is placed on top of the car flipper that looks like a floor jack. it is loaded with high pressure nitrogen that pushes into a piston which then throws the car as far as we five feet. what you want to get that air in that cylinder as fast as you can end as much as you can.
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that is what makes it work. 3, 2, 1 -- that is how you flip a car. >> before car flipper's, the industry's flipping tool of choice was a canon. now fraser rents his flippers for a couple hundred dollars a day. >> this is the most economical when they go to flip a static car. utat is going to cost you abo $2500. you multiply that by 30, it gets extensive. you get a cable in europe and around the car and you get that 200 feet. and you pull on that high-speed accelerator along with the car flipper can it will just pull the car. >> once you flip the car and it is in rough shape, what do you do with the car? >> these cars will all go back to -- they will go to a wrecker or something and probably, in four more years, they may look like a bobsled in the next
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olympics. [laughter] >> jon erlichman bloomberg los angeles. japan does a little retail therapy. we will find out how unit close under is looking for a spending spree in the united states.
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the cold war, russia and the west are at odds over the ukraine. stocks are falling on the crisis with investors seeking a haven in gold. here is data are looking at the markets with reaction to the ukraine. a bit of a run for risk-averse gold and away from stocks. >> that's right. a lot of people are reducing their risk exposure at this point. but that said, you do have individual stores or cross --
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individual stocks around the the region. fast retailing is one of them. we will get more details on that in just a bit. but said to be in talks by june. it could be worth $5 billion, in fact. perhaps another example here of japanese corporate looking abroad for growth. , it lowered its full-year forecast ahead. and mazda motor stopped falling because of the japanese yen. carmakers have the biggest exposures so far as where they get the revenue. looking at a japanese yen stronger today. changing or revisiting the ratings on japanese utilities. course, she coco electric up
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.7% and raise to neutral. australia's biggest decline or so far in the index. horizon oil, and earnings story, down 3%, rep warning a net loss. they are not applying any dividends. first half net income dropping 17%. one of the point out bright spots in that market is money flowing into gold as a safe haven play. that is why you see a large -- a stocksthese gold-mining in australia. limiting the losses. there we go.
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gold prices have gained about 142 u.s. dollars since the start of the year. that is what we have for the moment. back to you. >> it seems that j.crew has friends in high places and they will soon have a new owner. is japanese owner of uni qlo currently on the prowl. they are a sponsor for novak djokovic. >> you told me that earlier. i had no idea. , uni j. crew and uni qlo qlo buying j. crew, privately held. >> yes, uni qlo is managed by fast retailing. their goal is to become the world's largest retailer. you can go the acquisition rather go the organic route and do it yourself home grown, those type of sales and those type of businesses.
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in a deal that could be valued as much as $5 billion. j. crew has these really deep-scoop neck t-shirts and really preppy, brightly colored cardigans. they have a wideout in scum including the first lady of the united states, michelle obama. she is a huge fan of j. crew's clothing. they want to complete with -- they want to compete with the likes of h&m. they will be entering into australia as well as germany later on this year. they really want to focus on the united states. there are about 17 stores in the united states. by partnering with something like a j. crew, you can really expand your footprint in the united states. bidders perhaps involved as well. one is south korea's elan. we tried to reach out to no one commenting at the moment.
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>> fast retailing we know is listed and trading in japan. >> that's right. a and it was to look at listing in hong kong. why would it want to do that? >> that will happen wednesday. they are looking to do that not to raise shares, but to issue these depository receipts in a hope to expand their presence in hong kong. and by doing that, spending their presence in china. i want to show you exactly what fast retailing stock looks like. they have doubled in value in tokyo last year. that is beating what you have seen with the overall performance of the topix. close of 40% over that one-year time period. hoping they can increase the number of chinese consumers so the hong kong listing is pivotal to really grow that part of the equation. buying j.clearly crew, they can also have an ipo
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at some stage. >> that is true. j. crew is really owned privately and may consider doing an ipo as well. like fastng a harder retailing, you can see how that wealth of knowledge can be shared between those two companies. >> thank you so much. asia has some of the most gridlocked cities in the world. more than 20 million cars were sold in china alone last year, leading to clogged roads and increase pollution. stephen engle looks at what the government is doing to smooth the way forward. dayouldn't you know it on a i do a story about traffic, traffic today actually is not too bad in beijing. perhaps it is because the pollution levels are upwards of 400 and people are perhaps staying indoors. nevertheless, the beijing government and also the governments of other big cities that have the big traffic problems, they have been
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restricting the number of cars on the streets every workday. for example, i cannot drive on one day of the week. there are a lot of rumors that it will be spread to two days a week to get the number of cars off the streets. authorities are also tightening up the license plate lottery where they restrict the number of license plates that are actually issued every month. that was introduced in 2011. i got mine before the restriction came into being. oh, there is a guide. i just about hit him. that is another hazard of driving in china. back to the lottery system, the chinese joke that it is more likely to win the actual lottery than winning a license plate lottery. last year, 22 million vehicles were sold in the chinese market. for the fifth straight year, that surpassed the united states, making china the world's largest automobile market. hey, look, traffic again. you cannot go a mile without hitting bad traffic in china.
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analysts say, by 2020, this market will sell 30 million vehicles. and with a big push for urbanization, making big cities like beijing even bigger, the gridlock is just going to get worse. ratherrta holds the unwanted accolade of having one of the most congested streets in asia. >> jakarta he is a city of 10 million people did but that figure rises to 28 million once you take in the greater jakarta area. transportation study estimates that more than 3.5 million people commute every day from the suburbs area to the city center, creating some of the worst traffic in the world. texas north to the
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bloomberg tv indonesia office is right in the heart of the city. .t is more than 90 minutes now a quick look around shows you why. total gridlock. there are buses, but not enough. a limited aging train service. bikes are the only option for many jakarta residence. today is one of the worst. to a half hours so we average a speed of 3.6 kilometers an hour. that is slower than walking speed. >> for more on this, ross joins us now. you drive. drive.t no need to, really. but action must be taken.
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>> that is more important people -- more and more people are buying cars and that is an aspirational goal. last year committee 2 million cars were sold globally. is sayingy researcher that when 20 million cars will be sold in 2016. automakers are preparing to put that many cars on the road. so it is more and more cars on the road and less and less room. peak carhing called will happen in the next 10 years. that means that the number of car sales will crest at 100 million a year. why is that? because of urbanization and the driving conditions. there are too many cars on the road. people cannot get around. the u.n. is addicting that there will be 22 megacities next year, cities with more than 10 million in population. 12 of those in asia. means more people wanting cars. that means that people will car buyingave the
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market. in the u.s., they have already reached the car. .- reached peak car fewer people are buying cars. i think some of the best driving in china is pretty risky. >> a lot of corn beeping and swearing, you know, in italian obviously. english tourists who cannot drive on the right side of the road. me. more cars off the road, that's a good idea. energy costs on the way up on concern of gas supplies out of the ukraine. we will talk commodities when "on the move" returns, particularly the soft commodities.
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>> in a moment, we will look at the fallout from the crisis in
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ukraine. but first, a recap of some of the stories we are tracking on bloomberg tv. is monday, march 3. these are the top stories. china's manufacturing slowed the most in seven months. numbersed the luminary for february. pmi came in at 48.5, which indicates a contraction. thailand's empty government protesters who want the government to shut down bangkok said they would now continue the campaign. 23 people have died and hundreds more have been injured since protests began in october. have put itself in full alert as russia tightens
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its grip on crimea. the u.s. is considering sanctions and the g8 has suspended operations for a summit in sochi in june. president obama has spoken with his russian counterpart and has sent to john kerry to i -- to kiev today. aggression,act of in violation of international law, of the helsinki bags come basingukraine-russia agreement. russia has engaged in a military act of aggression against another country. >> and those are the top stories. >> you have energy futures right now surging, crude and national -- and natural gas. significant gains of 2.5%.
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for more on the energy markets, my next guest has been trading commodities for more than three decades. >> thank you for having me, john. >> our serious topic, ukraine fallout. doing?ould investors be theyere are three issues need to think about. it is goal because of global concern about what is evolving. so that should be bullish for gold. oso for the grains, if they thet to reduce exports, growing process will grow up -- will go up. , that will have the effect in the u.s. market as well. so the grains, precious metals,
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and maybe gas, brent crude oil. it's when you heard the headlines from ukraine, what did you start trading? >> i started buying more gold. gold is an insurance policy. >> safe haven. >> exactly. you sort of follow the herd. the other thing is i think the chinese will be buying that as well. there is enough in china to support that. so bold is the first and foremost whenever you have a problem like this, john. >> looking at wheat, drought, a very cold u.s., prices going up there as well. coffee, prices are up 62% this year. it is extraordinary. the drought in brazil, australia, where you come from, the u.s., and parts of asia. it is pretty intense. you have a lyrical uncertainty. you have the cold snap. how do you play this when you advise your clients? advise that they should
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remain long on all of those commodities until the middle of summer. they are rising in concert with the current weather. i could be underestimating or overestimating at this stage. coffee is interesting because that is really quite severe and up 44% last month. so the market is pricing in -- in a month. you could lose a large chunk of the brazilian crop due to weather. sweet, just about all of the -- , just about all the commodities are facing weather conditions or lyrical tension. year bowlers,he political tension, and adverse weather patterns. so i built my portfolio accordingly. the last couple of years, we haven't seen that. but this year, a could be similar to 2010 when you saw it bad0% to 40% because of weather. the last time he saw a coffee
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like this was in the 1990's and in the 1980's. it happened before and it can happen again. the data is already evolving. so i would suggest net long across the complex. watch stocks because of volatility's. >> what is your largest waiting -- largest weighting? is it gold? >> it is in the energy sector and then followed by gold. so it is third or fourth in the weightings. uranium is the fuel of the future. the politics around that -- i need to go to uranium because we cannot sustain -- 100 million cars in the previous article, that is not counting the cars that are already on the road. so demand for electrical cars and more fuel-efficient is coming.
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so uranium is offsetting electricity. but actual transportation logistics still require crude oil and hydrocarbons. >> you mentioned gas. a huge currency of choice in trading is gas. hardest traded to figure out right now, the gasoline? >> i don't think it's hard to figure out. of the world has reacted. his next move will be to start cutting back gas. so i think basically buying on the back of not enough coming through europe is worth the doing. they will start to try to mid -- to imported from the middle east. it is not good in the tension is not going away. that will be reflected in some of the commodities we have been talking about. >> always a pleasure to have you on. thank you for coming in. three decades of experience.
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up next, the indian tycoon has been arrested. live in mumbai.
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>> welcome back. checking stories and headlines around the world. gasol says that north korea has lired more missiles -- seou says that north korea has fired more missiles. four were fired last week with a range of 200 miles. chinese police have shown guns and knives used in in sunday's deadly attack. 140 were wounded. four the attackers were shot by
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police and a fifth was captured. the search continues for the other five. teodor -- two of the attackers were women. attacks, the most violent attacks have been blamed on uighur terrorists. a suicide car attack that killed five people at tienamen gate is the uighurs.n let's get background to this case. what is this about -- why has he been arrested? >> it is really about $2.9 billion which he owes to investors. he operates as someone who is
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aggregating money from small investors. the regulatory body here in india says that he has not refunded the demand that he has taken from investors, which has clearly been done illegally. where he claims that it has all been refunded. but the entire story is very industry -- very interesting. on tuesday, the supreme court said it had been patient enough with him. it issued an arrest warrant. when the police went to his house, they could not find him. on thursday, instead of making an appearance in the supreme page, he had a full advertisement saying that he is not of squandering. absconding. he owns the new york plaza hotel here. he also owns properties in london. companiesarly 120
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which have all been built on this model of collecting and investment from small investors which is being looked into. that is the latest happening on that story, john. a quick glance at india, futures looking like this. new have the market with futures a slightly lower when it opens in about an hours time from now, off by .1% after closing on friday. that is the indian futures looking slightly lower when it begins trading today. that is it for "on the move." says there are four key risks facing asian he will tell us what they are after the break. this is bloomberg television. "asia edge" up next.
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>> you are joining us in the middle of the asian trading day. we are live in hong kong, and this is asia edge. the top stories this hour, john kerry heads to ukraine, responding to russia's threat in the south. .tocks are falling and the search for money, chasing gold and the end. have the road to nowhere. asia's big cities grind to a halt.
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we have reports across the region. .t's a big week for china the economy and the environment top the agenda. we look ahead to the challenges they have to face. the oscars are under way right now. we are going to have details of who has won and who is not winning in l.a. we will have all that and more. >> kiev has put its military on full alert as russia heightens it grip on the crimea. the g7 has suspended preparations for the june summit in sochi. unidentified gunmen have , obama responded to putin and is sending his secretary of state to kiev today. >> what has already happened